Emmanuel OchayiIn the bustling streets of Lagos, vendors hawk goods at prices that seem to climb daily. Inflation, now at 34.80%, has become a relentless force threatening the stability of Nigeria’s economy. For many Nigerians, the rising cost of living is no longer a statistic; it’s a daily battle for survival.
A report by PricewaterhouseCoopers (PwC) paints a grim picture: unchecked inflation, coupled with a weakening naira and high interest rates, could push an additional 13 million Nigerians below the poverty line by 2025 as reported by Prime Business Africa. The social and economic consequences of this scenario could reshape the nation’s future.
Join our WhatsApp ChannelInflation’s Impact on Nigerians and the Economy
Inflation in Nigeria is not a new issue, but its current trajectory raises serious concerns. Over the past year, the headline inflation rate has soared to 34.80%, according to the National Bureau of Statistics. This steep rise has been fuelled by various factors, including global economic shocks, local supply chain disruptions, and government policies.
For those living below the poverty line—currently over 133 million Nigerians—the consequences are severe. PwC’s report highlights that the rising cost of goods and services disproportionately affects low-income households, particularly those employed in the informal sector, such as agriculture, small-scale businesses, and street vending.
“The recent minimum wage increase to N70,000 only affects 4.1% of the population,” said PwC. This means that for the vast majority of Nigerians, inflation continues to erode purchasing power. While the government has announced plans to distribute N75,000 cash transfers to those below the poverty thresholds questions remain about its long-term impact and sustainability.
Inflation Pushing Nigerians Deeper into Poverty
In Lagos, the voices of ordinary citizens echo the hardships inflation has brought into their lives. “Feeding my family is a continuous daily struggle, I’ve been on hope since last year that things will start to change but nothing I can see” said Daniel Umanah, a father of four who works as a trader in Ajao Estate, Lagos State. “What I earn in a day can no longer buy enough food for my children.”
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For Aisha Bello, a tailor in Lagos, complained of the rising cost of fabrics, and how it has nearly driven her out of business. “Customers complain that my prices are too high, but I also have to pay more for materials. I don’t know how long I can continue,” she said.
Michael Obi, an uber driver, shared his frustrations: “The cost of petrol is too high. I’ve had to increase my fares, and now fewer people want to use my service. It’s like there’s no way out. In December we hear of continuous decrease of petrol prices but since last week, I have been hearing of increment, even from Dangote Refinery. How are we going to survive this year?”
Experts Warn of Long-Term Consequences
Economists are sounding the alarm about the broader implications of inflation on Nigeria’s economy and social fabric.
“Inflation erodes savings, reduces purchasing power, and widens inequality,” explained Dr. Adedayo Williams, an economist. “Without targeted interventions, we risk creating a cycle of poverty that could take decades to reverse.”
Dr. Ifeoma Okonkwo, a policy analyst, criticised the government’s response, saying, “Short-term solutions like cash transfers are not enough. We need structural reforms that address the root causes of inflation, such as improving domestic production and stabilising the naira.”
Financial expert Chukwuma Eze added, “High inflation discourages investment, both local and foreign. Businesses can’t plan for the future in such an unstable environment. This will hurt job creation and economic growth. The government needs to proffer long time solution. They need to increase production in Nigeria to increase export.”
Government’s Response and Its Challenges
The Federal Government has attempted to mitigate the effects of inflation through policies like cash transfers. Minister of Humanitarian Affairs and Poverty Reduction, Prof. Nentawe Yilwatda, recently announced plans to distribute N75,000 to about 70 million Nigerians.
“The target of the president is to reach 15 million households, with an average of four to five members each,” Yilwatda said.
However, these efforts have been met with skepticism. Many Nigerians recall the suspension of similar programs in 2024 due to allegations of misappropriation. “It’s hard to trust that this money will reach the people who need it most,” said Mr Umanah.
Meanwhile, President Bola Tinubu has emphasised the need to pay workers “good and living wages.” While this is a step in the right direction, experts argue that wage increases alone cannot offset the impact of inflation on the wider population.
What Lies Ahead for Nigeria?
The path forward is fraught with challenges. If inflation continues to rise unchecked, it could lead to increased poverty, social unrest, and economic stagnation. As Dr. Williams noted, “Inflation is not just an economic issue; it’s a social one. It affects education, healthcare, and overall quality of life.”
The stakes are high, and the need for decisive action is urgent. Nigerians like Musa, Aisha, and Michael are counting on policymakers to find sustainable solutions. Without them, the dream of economic survival in 2025 may remain out of reach for millions.
Emmanuel Ochayi is a journalist. He is a graduate of the University of Lagos, School of first choice and the nations pride. Emmanuel is keen on exploring writing angles in different areas, including Business, climate change, politics, Education, and others.
